Hands Off Water

It is absolutely daft and blatantly irresponsible for government to propose the privatization of the CWA or worse handing over its management to the private sector

Life started in water. Without water, there is no life. Water is the most important natural resource for human beings. From the earliest times, human settlement has been organized near a river or some other fresh water source.

The ancient civilizations were logically established near rivers. These include Mesopotamia located between the Tigris and Euphrates rivers in Iraq, ancient Egyptian civilization situated on the banks of the Nile and the Indus valley (actually the Sindhu-Saraswati) civilization built on the banks of the mighty Saraswati river which is known to have watered down and eventually dried out around 1500 BCE. The latter showed early evidence of a sophisticated water management and supply system to the public with the help of numerous reservoirs as well as sanitation with the disposal of sewage through underground drains built for this purpose. In other places such as Tikal in Guatemala, the capital of one of the most powerful kingdoms of the pre-Columbian Maya civilization, water for the inhabitants was collected from rainwater and stored in ten reservoirs. Water is a vital resource for mankind.

Recent studies have however shown that water shortage is the most important challenge faced by the world today. The World Bank has predicted that by 2025, two-thirds of the world population i.e. more than 4 billion people will live with severe scarcity of fresh drinking water. Climate change and global warming are worsening the situation. Being in short supply, water has become an extremely precious natural resource, the more so as it is a basic human need that mankind cannot do without. The scarcity of such a vital resource is building into a new gold rush for private investors bent on exploiting water shortage to reap handsome profits. Water will become more demanded than gold as while we can live without gold we can certainly not live without water.

Against such a backdrop, it is absolutely daft and blatantly irresponsible for government to propose the privatization of the Central Water Authority (CWA) or worse handing over its management to the private sector. Billions of Rupees drawn from the Build Mauritius Fund financed by vehicle owners through a levy imposed on the price of diesel and petrol and other funds have been invested in the replacement of obsolete and leaking pipes and in new water reservoirs. They have significantly improved the CWA’s capacity to deliver a better supply of water and service to the people. Under such circumstances, it would be foolhardy and simply dumb to put at risk such important assets of the state by entrusting the management of the CWA to the private sector, the more so as the CWA enjoys a position of monopoly.

Water together with electricity, telephone or sewage are public goods and essential services which must be provided to the people by government corporations. This is the more so as the standard and efficiency with which these services are provided to all citizens play a key role in the socio-economic development and the quality of life of people. Water is such a vital resource to people that it is the role of government to ensure that this basic human need is available to all at a reasonable price.

Diametrically opposite

The objectives of the private sector are diametrically opposite those of government in respect of a public good. Apart from providing an efficient and affordable water supply service, government must also assure through appropriate environmental policies and oversight that the catchment areas for rainfall in the country are protected and ensure that groundwater in aquifers are not polluted by pesticides, chemicals and industrial waste or depleted. Once aquifers are emptied or polluted, they are almost impossible to restore. They must also ensure that there is minimum waste of water through leakages in dams, reservoirs or the network of distribution pipes. Consumers must also be canvassed through public awareness campaigns on the need to judiciously use this scarce resource. Profit cannot therefore be the driving consideration.

All these considerations as well as the imperative of providing safe water and an efficient consumer service in respect of a prime human need are of vital importance. There is therefore a high risk that profit driven privatization of the CWA in any form will shortchange the country on all these fundamental environmental and other issues which are necessary to assure inclusive access to safe water by all at reasonable and stable prices. It is therefore anathema to transfer the control of this precious and life giving resource from the public sector to the private sector

Mauritius is bogged down in a catch-22 situation. Overbearing political interference in the management and appointments in state corporations such as the Central Water Authority as well as in State companies and institutions over decades have systematically undermined their decision making acumen and efficiency. Oblivious that it is of their own doing, CWA is now being pilloried by government for poor management.

Similarly, the scale of the alleged scandals relating to Angolan sovereign funds which are presently afflicting the financial services sector is a blemish on the institutions and the governments under whose watch operating permits were misguidedly granted. Such a senseless situation is untenable. The upshot of such poor governance is that more flak can be expected. Scapegoats will only make matters worse. Is the country sitting on an explosive time bomb which can blow up at any moment?

Changing tack

There is no synergy among duds. Across the world, state owned corporations are successfully being managed without government interference by competent and highly regarded professionals. Why can’t we do likewise in Mauritius? The CWA must therefore be manned and managed by competent professionals in the field who operate free from government high-handedness in an accountable and transparent manner to provide an efficient service to the people. There is therefore an urgent need for a paradigm shift in respect of governance.

The government must focus on the core objectives for which they have been elected which above all include robustly upholding public interest, establishing a policy framework which promotes the well being and quality of life of people and anchoring governance on the highest standards of probity and service to the nation. As a cardinal corollary, they should imperatively let the government Establishment, the state institutions and the state companies be rigorously staffed on the basis of merit and competence and managed professionally by the best talents and expertise in the country in a transparent and accountable manner. Not to do so is to continue as presently to hobble the prospects of the country.

Crying lessons must also be learnt from the country’s experience with the privatization of utilities such as telecommunication and energy production. We must recall the blunders of the past in the context of leonine and cast in stone Independent Power Producer (IPP) contracts which skewed and robustly safeguarded the interests of the promoters by indexing the electricity price on fuel oil and coal costs as well as currency and economic indices in the teeth of public interest. A profound review is required as some of these come up for renewal this year. The sugar planters who were to become commensurate shareholders of the cane sugar cluster enterprises using their cane bi-products as feedstock so as to shore, as is the case for the corporate sector, their falling sugar revenue with revenues from the cluster have also been left high and dry by government.

Energy protection from principally coal is a highly lucrative activity and strong lobbies have by and large ring fenced its production among current producers despite the fact that coal pollutes significantly more than oil, gasoline or natural gas. In a context of dwindling bagasse production, the lion’s share of electricity production i.e. 41.6% was from highly polluting coal in 2016. Private investors in an essential public good such as electricity follow their own profit driven logic. However, in line with the country’s COP21 commitments to produce 35% of our energy requirements from renewable energy sources by 2025, it is high time that the scientific reality that coal is among the most highly polluting energy sources is factored in, in our national energy policy framework.

We must also remember the privatization of Mauritius Telecom in 2000 to France Telecom (now Orange S.A.) which acquired 40% of its shares. Such sales of the state assets are one off transactions. Once sold, the asset is gone. After nearly two decades, it begs so many questions as to the choice of the strategic partner, the long term cost benefit of the privatization and more importantly the tangible benefits to the consumers especially in respect of the quality and cost of internet and mobile phone services.

Any proposal to privatize an essential natural resource which mankind cannot do without in an international context of severe water shortage has no leg to stand on. It is in essence a futile wild goose chase. Instead, it is much more important to learn from the crying lessons of the privatization of other essential utilities in the country and urgently take the necessary corrective steps to set things right in the public interest. No wonder that the rising and loud clamour from the people is an unequivocal: Hands off water.